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CHAPTER Ⅰ GENERAL PROVISIONS
Article 1 (Purpose)
The purpose of this Rule is to provide for matters delegated by the Seoul Metropolitan Government Ordinance on the Establishment and Operation of Small and Medium Business Support Fund and matters necessary for the implementation thereof. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
Article 2 (Definitions)
The terms used in this Rule shall be defined as follows: <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
1. The term "business stabilization loan" means funds lent in order to support programs for the stabilization of business management of small and medium enterprises and appropriated to the operation of enterprises, except for capital investment; <Amended by Enforcement Rule No. 3630, Aug. 4, 2008>
2. The term "facility loan" means funds lent in order to support projects for the improvement of manufacturing facilities, such as automation, informatization, and the development and commercialization of technology, programs for supporting site location, projects for the improvement of distribution structure, projects for the redevelopment of markets, joint projects with small and medium enterprises, building projects, hotel business, lodging business, projects for the establishment of research institutes attached to a small or medium enterprise, etc.; <Amended by Enforcement Rule No. 3547, Apr. 26, 2007; Enforcement Rule No. 3630, Aug. 4, 2008>
3. The term "lending agency" means a financial institution that the Mayor of the Seoul Metropolitan Government (hereinafter referred to as the "Mayor") entrusts with the management of the Small and Medium Business Support Fund of the Seoul Metropolitan Government (hereinafter referred to as the "Fund") pursuant to Article 18 of the Seoul Metropolitan Government Ordinance on the Establishment and Operation of Small and Medium Business Support Fund (hereinafter referred to as the "Ordinance"); <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
4. The term "loan to the lending agency" means a loan lent from the Fund by the Mayor to the lending agency; <Amended by Enforcement Rule No. 3630, Aug. 4, 2008>
5. The term "loan to a financial institution" means a loan lent from the Fund by the lending agency to a financial institution dealing in loans from the Fund; <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008>
6. The term "loan to an enterprise" means a loan lent by a financial institution from the Fund borrowed from the lending agency to a small or medium enterprise or an organization relating to small and medium enterprises under Article 5 (1) 1 of the Ordinance; <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008>
7. The term "financial institution" means any of the following institutions: <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(a) A financial institution under the Banking Act; <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(b) The Korea Development Bank under the Korea Development Bank Act; <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(c) The Industrial Bank of Korea under the Industrial Bank of Korea Act; <Amended by Enforcement Rule No. 3630, Aug. 4, 2008>
(d) The Export-Import Bank of Korea under the Export-Import Bank of Korea Act; <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(e) An agricultural cooperative or the National Agricultural Cooperative Federation under the Agricultural Cooperatives Act; <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(f) A fisheries cooperative or the National Federation of Fisheries Cooperatives under the Fisheries Cooperatives Act; <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(g) A community credit cooperative under the Community Credit Cooperatives Act; <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(h) A credit union under the Credit Unions Act; <Newly Inserted by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(i) The Korea Federation of Small and Medium Business under Article 3 (1) 4 of the Small and Medium Enterprise Cooperatives Act: Provided, That the foregoing shall apply only to cases where it lends funds in relation to the Mutual Aid Fund for Small and Medium Enterprises under Article 111 of the Small and Medium Enterprise Cooperatives Act; <Newly Inserted by Enforcement Rule No. 3760, Jul. 22, 2010>
8. The term "manufacturing concentration ratio" means the ratio of the sales that a person who intends to borrow funds from the Fund achieved in his/her manufacturing business during the latest fiscal year to his/her gross sales during the same period. In such cases, self-consumption, if any, shall be added to the sales; <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
9. The term "financial statements" means a balance sheet, an income statement, a statement of appropriation of retained earnings, and a statement of disposition of deficits, prepared in order to ascertain the financial position of an enterprise; <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
10. The term "estimated sales" means the sales calculated by taking into comprehensive consideration the average sales increase rate, the results of sales at the time of the calculation, the supply contract amount, the production capacity, the current status of operation, business trends of the same industry, and other relevant factors, based on financial statements for the latest three years. <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
CHAPTER Ⅱ OPERATION AND MANAGEMENT OF FUND
Article 3 (Operation of Fund)
(1) Pursuant to Article 6 (1) of the Ordinance, the Fund may be operated for the following separate categories of support programs: <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
1. A program for lending funds to small and medium enterprises;
2. A program for rendering assistance in the establishment of small and medium business support facilities;
3. A program for rendering assistance for investment in start-up businesses for the purpose of investment or contribution;
4. A program for contributing funds to corporations that the Metropolitan Government has established for the development of small and medium enterprises.
(2) The Mayor shall include the amount of the operating fund for each support program under paragraph (1), eligibility requirements for the support, terms and conditions of the support, etc. in an annual fund operation plan and support plan. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
Article 4 (Loans to Lending Agency)
(1) The Mayor shall set the interest rate on a loan to the lending agency lower than the interest rate on a loan to an enterprise by one percent or less. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(2) The lending agency shall, upon receipt of a loan from the Fund, immediately submit a written loan receipt to the Mayor. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(3) The Mayor shall execute a separate agreement with the lending agency on the management and operation of the Fund lent to the lending agency. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
Article 5 (Lending Institutions)
(1) Lending institutions mean the lending agency and the head office or a branch office of a financial institution that enters into an agreement with the lending agency. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(2) A lending institution that intends to secure a loan from the Fund shall execute an agreement with the lending agency on the lending and operation of the Fund.
<Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
Article 6 (Disbursement of Loans)
(1) In principle, a lending institution shall disburse a loan from the Fund on the day when it takes out a loan from the lending agency: Provided, That a loan shall be disbursed within seven days from the day when the loan is extended from the lending agency, if documents required for lending the loan are not properly made out or there are any other extenuating circumstances. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3686, Aug. 27, 2009>
(2) A lending institution shall, if it fails to disburse a loan within the period set forth in paragraph (1), repay the principal of the loan secured from the Fund and the interest thereon (an amount calculated by applying the interest rate applicable to the loan to an enterprise to the number of days from the date of securing the loan to the date of repayment) to the lending agency not later than the day immediately following the due date for extending the loan (or its first business day after an official holiday, if the due date falls on an official holiday). <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(3) No lending institution shall alter any terms or conditions of a loan under Article 9 in lending to an enterprise under this Rule. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
Article 7 (Obligations of Lending Institutions)
Each lending institution shall manage loans so that they may be used efficiently in accordance with this Rule and the agreement entered into with the lending agency and shall conduct follow-up management, particularly to prevent loans from being expended for any purpose other than those set for the loans. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006>
SECTION 1 Decision-Making to Extend Loans
Article 8 (Eligibility Requirements for Loans)
(1) In cases of programs for lending funds to small and medium enterprises, loans shall be classified into business stabilization loans and facility loans. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(2) A person entitled to obtain a business stabilization loan shall meet the eligibility requirements for business stabilization loans set forth in Table 1. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(3) A person entitled to obtain a facility loan shall meet the eligibility requirements for facility loans set forth in Table 1. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
Article 9 (Terms and Conditions of Loans)
(1) A business stabilization loan to a business entity shall not exceed 500 million won, and the repayment term of such loan shall be any of the following terms: <Amended by Enforcement Rule No. 3443, May 19, 2005; Enforcement Rule No. 3588, Dec. 26, 2007>
1. Repayment in a lump sum in two years; <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
2. Repayment in equal installments in three years after a grace period of one year; <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
3. Repayment in equal installments in four years after a grace period of one year; <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
4. Repayment in equal installments in three years after a grace period of two years. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(2) The terms and conditions of facility loans provided for each support program and the limits on such loans are as set out in Table 3. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(3) The interest rates on a loan to an enterprise and on a loan to the lending agency shall be determined by the Mayor, taking into consideration the interest rates on loans secured to raise the Fund, market interest rates, economic conditions and other relevant factors, and shall be publicized in daily newspapers or on the Internet. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
Article 10 (Loan Application)
(1) A person who is eligible for a loan under Article 8 and so intends to obtain the loan shall file an application with the Mayor, along with the loan application documents. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(2) In principle, a loan application under paragraph (1) may be filed at any time in a year: Provided, That the Mayor may set a period for filing loan applications, if he/she considers it necessary in view of the size of the Fund and other factors. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
Article 11 (Loan Decisions)
(1) The Mayor shall, upon receipt of a loan application under Article 10 (1), examine the business feasibility, growth potential, competitiveness, technical capabilities, financial statements, etc. of the relevant enterprise to make a decision on whether to lend a loan and the amount of the loan. In such cases, the guidelines for such examination shall be determined by the Mayor, taking economic conditions and other factors into consideration. <Amended by Enforcement Rule No. 3352, Oct. 6, 2003; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(2) The Mayor shall notify the loan applicant, the lending agency, the lending institution, etc. of a decision under paragraph (1) not later than ten days from the filing date of the application: Provided, That such notification may be made after the lapse of ten days, if it is necessary to bring the case to the loan examination committee under paragraph (3) for deliberation or there are any extenuating circumstances. <Amended by Enforcement Rule No. 3352, Oct. 6, 2003; Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(3) The Mayor may organize the loan examination committee in making a decision under paragraph (1) on a loan application for a project, if he/she considers that the project has a significant economic effect, to make a decision after deliberation by the committee. In such cases, necessary matters for such cases shall separately be determined by the Mayor. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(4) The Mayor may make decisions on loans of up to 120 percent of the budget amount for loans in order to utilize the unused fund that might be incurred in the course of lending due to renunciation of loans or other events. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
Article 12 (Guidelines for Making Decisions on Loan Amounts)
(1) In making decisions on loan amounts under Article 11, the Mayor shall comply with Table 1, if the loan is a business stabilization loan: Provided, That the criteria for sales may not be applicable in any of the following cases: <Amended by Enforcement Rule No. 3352, Oct. 6, 2003; Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
1. Where the loan amount does not exceed 50 million won. In such cases, the balance not paid off yet shall be included in the amount, if a person has already obtained another loan;
2. Where a credit guarantee institution approves credit guarantee for the loan applicant. <Amended by Enforcement Rule No. 3630, Aug. 4, 2008>
(2) The amount of a facility loan shall be decided in consideration of the land purchase price, the building cost, the equipment cost, moving expenses, and other project costs within the limit set forth in Table 3. The detailed guidelines necessary for making a decision on the loan amount in such cases shall be determined by the Mayor. <Amended by Enforcement Rule No. 3352, Oct. 6, 2003; Enforcement Rule No. 3686, Aug. 27, 2009>
Article 13 (Preferential Measures for Enterprises Eligible for Loans)
(1) The Mayor may preferentially treat and support enterprises participating in projects implemented in accordance with a major policy of the Government or the Seoul Metropolitan Government, in making decisions on loans pursuant to Article 11. <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(2) The enterprises eligible for preferential treatment under paragraph (1) and the criteria therefor shall be determined by the Mayor in consideration of economic conditions. <Amended by Enforcement Rule No. 3352, Oct. 6, 2003; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
Article 14 (Decision on Double Loans)
The Mayor may decide to extend an additional loan to a person who is still repaying a loan taken from the Fund as of the filing date of another loan application within the amount calculated by subtracting the balance of the loan already extended but not paid off yet from the limit on loans under Article 9. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
Article 15 (Restriction on Lending)
The Mayor may place a restriction on lending to any of the following persons: <Amended by Enforcement Rule No. 3547, Apr. 26, 2007; Enforcement Rule No. 3686, Aug. 27, 2009>
1. A person who is under a sanction imposed by a financial institution in accordance with credit information under the financial institution's enforcement rules on the management of credit information; <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008>
2. A person who is a company affiliated to a conglomerate under the financial institution's operating regulations on credit extension;
3. A person whose business is suspended or closed down (excluding persons whose business is suspended or closed down due to the redevelopment, reconstruction, extension, remodelling, or repair of an existing traditional market, a tourist hotel, a floating tourist hotel, a traditional Korean-style hotel, a family hotel, or a lodging facility participating in a project implemented by the Seoul Metropolitan Government in order to cluster tourist lodging facilities in a complex); <Amended by Enforcement Rule No. 3547, Apr. 26, 2007>
4. A person who expropriated a loan already obtained for any purpose other than the purpose set for the loan.
SECTION 2 LENDING AND RECOVERY OF LOANS
Article 16 (Persons Eligible for Loans)
In order for a person to be eligible for a loan, he/she shall be notified of a loan decision under Article 11 (1) or (2). <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
Article 17 (Lending Procedure)
(1) A lending institution shall advance a loan to a person eligible for the loan under Article 16 after taking measures for securing the loan, unless there are any extenuating circumstances: Provided, That if a facility loan is provided for a project relating to building works, 40 percent of the amount of the loan decided pursuant to Article 11 may be paid in advance after a report on the commencement of the building works is filed, and the balance shall be paid according to the work progress rate. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(2) A lending institution may conduct credit research in accordance with the lending institution's bylaws, if the research is necessary for the purpose of securing loans, and may refuse to extend a loan, if a person is found ineligible for the loan as a result of the research. In such cases, the lending agency shall be notified of the grounds of the refusal without delay. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3686, Aug. 27, 2009>
(3) Except as otherwise provided for in this Enforcement Rule, the lending procedure shall be governed by each financial institution's regulations on the management of loans. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
Article 18 (Deadlines for Obtaining Loans)
(1) A person eligible for a loan under Article 16 shall obtain the loan (referring to the first installment of a loan, if the loan is drawn in installments) within the period set in the following subparagraphs from the day when the notice of the relevant loan decision is given: <Amended by Enforcement Rule No. 3520, Nov. 30, 2006;; Enforcement Rule No. 3686, Aug. 27, 2009>
1. Business stabilization loan: Three months, but the period may be extended by up to two months in the presence of extenuating circumstances; <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
2. Facility loan:
(a) For a project for the construction of an apartment-type factory, the construction of facilities for the clustering of venture businesses or the construction of facilities for the development of software, a project for a balanced development promotion district, a project for the construction of facilities for a recommended type of business in an industrial development promotion district or a specific development promotion district, a hotel business, or a lodging business: Two years; <Amended by Enforcement Rule No. 3588, Dec. 26, 2007; Enforcement Rule No. 3686, Aug. 27, 2009>
(b) A project for the establishment of a factory or a place of business involving construction works or a project jointly implemented by small and medium enterprises: Two years;
(c) A project for the redevelopment of a market: Three years, but the period shall be six months for a project for the installation of a temporary market;
(d) Other projects: Six months, but the period may be extended by up to four months in the presence of extenuating circumstances. <Amended by Enforcement Rule No. 3352, Oct. 6, 2003>
(2) If a person fails to take out a loan within the deadline under paragraph (1), he/she shall be deemed to forfeit the eligibility for the loan referred to in Article 16. <Amended by Enforcement Rule No. 3352, Oct. 6, 2003; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
Article 19 (Repayment of Principal and Interest)
(1) The principal of a loan shall be repaid in equal installments at the end of each quarter (December 20th for the fourth quarter) after the lapse of a grace period, but a residual amount not divisible in equal installments shall be reimbursed along with the first installment of the loan. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(2) The interest on a loan shall be paid at the end of each quarter (December 20th for the fourth quarter); when the principal of a loan is to be repaid before the end of the loan term, the interest thereon shall be paid on the payment date of such principal. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(3) Other necessary matters, including methods for the repayment of loans, shall be governed by each financial institution's regulations on the management of loans. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
Article 20 (Recovery of Loans before Maturity)
If any of the following events occurs in relation to a borrower of a loan from the Fund, the Mayor may order the borrower to repay the loan fully or partially even before the date of maturity or to take other necessary measures: <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
1. Where the borrower uses the loan for any purpose other than the purpose set for the loan;
2. Where the borrower breaches an obligation under any Act, subordinate statute, ordinance, this Rule, or the relevant loan agreement. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006>
SECTION 3 Cooperative Loans from Financial Institutions
Article 21 (Cooperative Loans from Financial Institutions)
(1) In order for a person to be eligible for a cooperative loan from a financial institution under Article 12 of the Ordinance, the person shall meet the eligibility requirements for a business stability loan set forth in Table 1, and the terms and conditions of such a loan and the repayment thereof shall be determined by the Mayor. <Amended by Enforcement Rule No. 3588, Dec. 26, 2007; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(2) The compensation for the difference in interest under Article 12 (2) of the Ordinance shall be paid into the bank account designated by the financial institution at the request of the financial institution. <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(3) Except as otherwise provided for in the Ordinance and this Enforcement Rule, necessary matters concerning a cooperative loan from a financial institution shall be stipulated by an agreement between the Mayor and the relevant financial institution. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
SECTION 4 Follow-Up Management
Article 22 (Reporting on Change and Approval thereof)
(1) If there is a change in any of the following matters during the period between the day when a person eligible for a loan under Article 16 is notified of the loan decision and the day when the loan decision is cancelled or the loan is fully repaid, the person shall report such change to the Mayor: Provided, That any change of a matter under subparagraph 4 or 8 shall obtain prior approval from the Mayor: <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
1. Trade name;
2. Location of the factory;
3. Representative's name (limited to a change of the representative director of a corporation and a change of the representative of an unincorporated private enterprise by inheritance);
4. Lending institution: however, the lending institution shall not be changed where it was agreed to disburse a loan in installments and the first installment of the loan has already been disbursed; <Amended by Enforcement Rule No. 3520, Nov. 30, 2006>
5. A change in any fact regarding the representative, except those under subparagraph 3;
6. Conversion of an unincorporated private enterprise into a corporation or a corporate merger;
7. A change in the type of the main manufacturing business;
8. A change in facilities eligible for support (excluding matters whose changes are delegated to the lending institution). <Amended by Enforcement Rule No. 3520, Nov. 30, 2006>
(2) The Mayor may, upon receipt of an application for approval under the proviso to paragraph (1), investigate the actual conditions in order to identify necessary facts. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(3) If there is a change in the quantity, specifications, the amount of the required fund, or the manufacturer of a facility installed with a loan within the extent of the purpose of the loan, the person eligible for the loan shall report the change to the lending institution. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3686, Aug. 27, 2009>
(4) A lending institution shall, upon receipt of a report under paragraph (3), notify the lending agency of the report, and the lending agency shall notify the Mayor thereof. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3686, Aug. 27, 2009>
Article 23 (Revocation of Loan Decisions)
(1) The Mayor may revoke a loan decision if any of the following events occurs in relation to the person subject to such loan decision. In such cases, he/she shall notify the lending agency and the lending institution of such revocation: <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
1. Where the person fails to comply with a demand for performance or corrective measures or a warning given pursuant to this Rule without justifiable grounds; <Amended by Enforcement Rule No. 3630, Aug. 4, 2008>
2. Where proceedings for bankruptcy or composition are in progress in relation to the person, or the person is notified of the commencement of compulsory execution due to delinquent national taxes, bankruptcy, corporate reorganization, or court auction; <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
3. Where the person's business is suspended or closed down. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(2) A lending institution shall, upon receipt of notice under paragraph (1), promptly recover the loan already disbursed from the Fund to the person whose loan decision has been revoked. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3686, Aug. 27, 2009>
Article 24 (Submission of Performance Report, etc.)
(1) A person who obtains a facility loan shall submit performance reports to the Mayor for two years starting from the year immediately following the year in which the loan is provided. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(2) If the Mayor deems necessary to verify performance under paragraph (1), he/she may conduct an inspection on whether the borrower has implemented the project plan (referring to the project plan submitted at the time of filing the loan application and the revisions thereto; the same shall apply hereinafter). In such cases, the inspection shall be mainly focused on the following matters: <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
1. The performance of the project plan and whether the facility is in normal operation;
2. Whether the loan is being expended properly.
(3) The Mayor may take any of the following measures, if he/she considers it necessary to take such a measure as a result of inspection under paragraph (2): <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
1. An order to revise the project plan;
2. A recommendation to seek guidance provided by a specialized guidance institute recognized by the State for business management or technology;
3. A demand to implement the project, a warning, an order to recover the loan, etc.
Article 25 (Follow-Up Management Period)
The follow-up management period for a borrower shall begin in the year immediately following the year in which the loan is initially provided and end at the time the loan is fully repaid. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3686, Aug. 27, 2009>
CHAPTER Ⅳ SUPPORT FOR ESTABLISHMENT OF SMALL AND MEDIUM BUSINESS SUPPORT FACILITIES, SUPPORT FOR INVESTMENT IN BUSINESS START-UPS, ETC.
Article 26 (Support for Establishment of Small and Medium Business Support Facilities)
(1) The following small and medium business support facilities may receive financial support pursuant to Article 13 of the Ordinance: <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
1. Facilities set forth in Article 3 of the Seoul Metropolitan Government Ordinance on the Establishment and Operation of Small and Medium Business Support Facilities; <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3686, Aug. 27, 2009>
2. Small and medium start-up business incubation centers run by the Seoul Metropolitan Government or an autonomous Gu; <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
3. Other facilities established and operated or planned to be established in order to assist small and medium enterprises. <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(2) Loans shall be used only for fixed assets in the nature of capital, including the purchase, construction, or lease of support facilities and production facilities. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(3) A person who runs a facility with a facility loan shall submit reports on the current status of assets in operation, including the loan obtained, to the Mayor twice a year (January, July). <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
Article 27 (Recovery of Loans)
(1) The Mayor shall inspect the current state of the management of facility loans provided to an individual or an organization for the establishment of small and medium business support facilities from time to time and shall recover the loans without delay, if they have been expropriated for any purpose other than the purpose previously set or the target project is completed. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
Article 28 (Support for Investment in Business Start-Ups)
The Mayor shall include the following in the plan established pursuant to Article 14 (2) of the Ordinance for assisting investment in start-up businesses: <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
1. Overview of the program;
2. Scope of investment;
3. A plan for investment or contribution;
4. A plan for the distribution of earnings and the disposition of deficits;
5. Methods of operating the funds invested or contributed;
6. Other matters necessary for the operation and management of the funds invested or contributed. <Amended by Enforcement Rule No. 3630, Aug. 4, 2008>
Article 29 (Special Loans)
(1) When the Mayor intends to establish a plan for providing special loans pursuant to Article 17 of the Ordinance, he/she shall include the following matters in the plan and publicize the plan in daily newspapers and on the Internet: <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
1. The area and types of business eligible for the loans;
2. Terms and conditions of the loans;
3. Other matters necessary for the special loans. <Amended by Enforcement Rule No. 3630, Aug. 4, 2008>
(2) When the Mayor establishes a plan for providing special loans pursuant to paragraph (1), he/she may determine the eligibility requirements and terms and conditions of the loans, irrespective of those under Articles 8 and 9. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
CHAPTER Ⅴ SUPPLEMENTARY PROVISIONS
Article 30 (Entrusted Administrative Affairs, etc.)
(1) The Mayor may entrust the lending agency with the following administrative affairs pursuant to Article 18 of the Ordinance: <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
1. Management of loans disbursed from the Fund operated pursuant to Article 3 (1); <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
2. Disbursement and repayment of loans from the Fund; <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3686, Aug. 27, 2009>
3. Management of changes in other matters relating to borrowers. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3686, Aug. 27, 2009>
(2) The entrusted agency under paragraph (1) shall submit a report on the current status of the execution of administrative affairs to the Mayor not later than the tenth day each month. <Amended by Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(3) Pursuant to Article 18 of the Ordinance, the Mayor may entrust the Seoul City Credit under the Seoul Metropolitan Government Ordinance on the Establishment and Operation of the Seoul City Credit with the following administrative affairs: <Amended by Enforcement Rule No. 3352, Oct. 6, 2003; Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
1. Receipt of loan applications under Article 10; <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
2. Decision-making on loans pursuant to Articles 11 and 13 through 15; <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
3. Notification of loan decisions under Article 16; <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
4. Follow-up management under Articles 20, 22 (1) and (2), 23 (1), and 24; <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
5. Management of changes in other matters relating to borrowers. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3686, Aug. 27, 2009>
(4) The entrusted agency under paragraph (3) shall establish and implement detailed operating regulations necessary for the execution of entrusted administrative affairs with the Mayor's approval thereof. <Amended by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
(5) The entrusted agency under paragraph (3) shall, whenever it accepts a report on change under Article 22 (1) or approves an application for such change or a cause or an event that constitutes a ground for revoking a loan decision pursuant to Article 23 (1) occurs, notify the Mayor thereof without delay. <Newly Inserted by Enforcement Rule No. 3520, Nov. 30, 2006; Enforcement Rule No. 3630, Aug. 4, 2008; Enforcement Rule No. 3686, Aug. 27, 2009>
Article 31 (Inspection on Entrusted Administrative Affairs, etc.)
(1) The Mayor may require an entrusted agency to submit data necessary for the efficient management and operation of the Fund and the establishment and implementation of the plan for providing loans from the Fund or assign public officials under his/her jurisdiction to conduct an inspection thereon. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
(2) If the entrusted agency violates an Act, a subordinate statute, or guidelines for the execution of administrative affairs or causes serious harm to public interests in executing any entrusted administrative affair, the Mayor may cancel the action taken or require the entrusted agency to correct or cancel the action taken. <Amended by Enforcement Rule No. 3686, Aug. 27, 2009>
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